Economics Homework for Final
Before the Civil War, the South traded with the North and with England. The South sold cotton and bought manufactured goods and food. During the war, one of President Lincoln's first actions was to blockade the ports and prevent this trade. The South had to increase its production of munitions and food. The South had a comparative advantage in producing _______.
Cotton
Kim can produce 40 pies per hour or 400 cakes per hour. Liam can produce 100 pies per hour or 200 cakes per hour.
Kim's opportunity cost of producing a pie is 10 cakes. Liam's opportunity cost of producing a pie is 2 cakes. Liam has a comparative advantage in producing pies while Kim has a comparative advantage in producing cakes Kim spends 30 minutes producing pies and 30 minutes producing cakes, Kim produces 20 pies and 200 cakes. If Liam spends 30 minutes producing pies and 30 minutes producing cakes, Liam produces 50 pies and 100 cakes.
Your price elasticity of demand for bananas is 4. If the price of bananas rises by 5 percent, what is the percentage change in the quantity of bananas you buy? What is the change in your expenditure on bananas?
The percentage change in the quantity of bananas demanded is a decrease of 20 percent. The percentage change in your expenditure on bananas decreases by approximately 15 percent.
A fall in the price of chocolate sauce of 2 percent increases the quantity of chocolate sauce demanded by 10 percent and increases the quantity of ice cream demanded by 12 percent.
The price elasticity of demand for chocolate sauce is 5 The cross elasticity of demand for ice cream with respect to the price of chocolate sauce is -6
Barron Davis has ______ advantage in playing basketball and ______ advantage in movie directing, which is the reason for his success in both activities.
a comparative; a comparative
a. The Table shows Westland's production possibilities. The marginal cost of a pound of tea when the quantity produced is 150 pounds of tea per month is______ b. The marginal cost curve in Westland is ___________
a. 0.50 pairs of hiking boots b. a horizontal line
As the prices of homes rose across the United States in 2014, the number of homes offered for sale started to increase. a. Choose the statement that explains this price increase. b. Home owners would hold off trying to sell because _______.
a. As the demand for homes increases, the demand curve for homes shifts rightward and the quantity of homes supplied increases. This fact illustrates the law of supply. b. they expect the price of homes will rise in the future
Think about the demand for the three popular game consoles: XBox One, PlayStation 4, and Wii U. What is the effect of the following events in the market for XBox One games, other things remaining the same? A. Programmers who write code for Xbox One games become more costly to hire B. The price of an Xbox One falls C. The prices of a PS4 and a Wii U fall D. A new game console comes onto the market, which is a close substitute for Xbox One a. Event A ______ the ______ XBox One games. b. Event B ______ the ______ XBox One games. c. Event C ______ the ______ XBox One games. d. Event D ______ the ______ XBox One games.
a. decreases; quantity demanded of b. increases; demand for c. decreases; demand for d. decreases; demand for
a. When Apple Inc. pays the designers of the iPad, the flows are a __________ from firms to households and a ______________ from households to firms b. When you buy an iPad from the Apple Store, the flows are a _________ from households to firms and a _________ from firms to households
a. money flow; real flow b. money flow; real flow
a. An Act of the United States Congress increased U.S. production of corn by mandating a ______. As the production of corn increases, the opportunity cost of corn ______. b. In the rest of the world, a movement along the PPF occurred due to ______ in the quantity of land devoted to producing corn. The PPF also shifted ______ due to drought, which increased the cost of producing corn. c. The United States achieves allocative efficiency in corn production if its marginal benefit ______ marginal cost.
a. steady increase in the production of ethanol; increases because resources are not equally productive in all activities b. an increase; inward c. equals
Shoppers bought strawberries in March for $1.25 a pound rather than the $3.49 a pound they paid last year. With the price so low, some growers plowed over their strawberry plants to make way for spring melons; others froze their harvests and sold them to juice and jam makers. a. If growers did not plow in their plants and instead offered locals "you pick for free", all of the following occurs except_______. b. Given the lower price of strawberries, the ______ and the price of strawberry jam ______.
a. the equilibrium quantity of strawberries sold in grocery stores increases b. supply of strawberry jam increases; falls
a. The price of gasoline has increased during the past year. The law of demand applies to gasoline because when the price of gasoline rises, ______. b. The income effect influences gasoline purchases because when the price of gasoline rises, other things remaining the same, ______. Consumers ______. c. The substitution effect influences gasoline purchases because when the price of a gallon of gasoline rises, other things remaining the same, _______. Consumers _______.
a. the quantity demanded decreases b. the price of gasoline rises relative to income; cannot afford to buy all the things they previously bought, so they buy less gasoline c. its relative price rises; look for alternate means of transportation
This year Americans are taking fewer exotic holidays by air and instead are visiting local scenic places by car. The global financial crisis has encouraged many Americans to cut their holiday budgets. Given the prices of the two holidays, the income elasticity of demand for exotic holidays is ______ and the income elasticity of demand for local holidays is ______.
a. positive; negative b. Exotic holidays are a normal good and local holidays are an inferior good
The graph shows Yucatan's PPF for food and sunscreen. Yucatan faces ______ opportunity cost of food and ______ opportunity of sunscreen, which can be seen by the shape of the PPF.
a constant; a constant
Capital accumulation and technological change bring economic growth: Production that was unattainable yesterday becomes attainable today; production that is unattainable today will become attainable tomorrow. This process of economic growth _______.
does not eliminate scarcity because we still must give up production of one good to increase production of a second good and remain on the production possibilities frontier
If a price cut _______ total revenue, demand is ______.
does not change; unit elastic
Online movie rental service Netflix has introduced a new feature to allow customers to watch movies and television series on their personal computers. Netflix competes with video rental retailer Blockbuster, which added an online rental service to the in-store rental service. The offering of online movie viewing ______ the price elasticity of demand for in-store movie rentals. The cross elasticity of demand for online movies and in-store movie rentals is ______. The cross elasticity of demand for online movies with respect to high-speed internet service is ______
increases positive; negative
With higher fuel costs, airlines raise their average fare from $0.50 to $1.50 per passenger mile and the number of passenger miles decreases from 2.5 million a day to 1.5 million a day. Over the price range of $0.50 to $1.50 per passenger mile, the price elasticity of demand is . 5. Over this price range, the demand for air travel is ______.
inelastic
The world market for crude oil is a competitive market because _______.
it has many buyers and many sellers and no single buyer or seller can influence the price
Exotic holidays and local holidays are substitutes if ______.
the cross elasticity of demand is positive
The money price of a textbook is $90 and the money price of the Wii game Super Mario Galaxy is $45.
the number of Wii games you must give up to get the textbook
When Alex's income increased from $3,000 to $5,000, he increased his consumption of bagels from 5 to 9 a month and decreased his consumption of donuts from 16 to 10 a month.
Alex's income elasticity of demand for bagels is 1.14 Alex's income elasticity of demand for donuts is -.92
General Motors cut its fourth-quarter production schedule by 10 percent because Ford Motor, Chrysler, and Toyota sales declined in August. This news clip illustrates a decrease in ______ and ______ in the market for cars.
demand; a decrease in the quantity supplied
During the recession, Wal-Mart moved its pet food and supplies to the front with its other fast-growing business, baby products. Retail experts point out that kids and pets tend to be fairly recession-resistant businesses long dash—even in a recession, dogs will be fed and kids will get their toys. The news clip implies that the demand for pet food and baby products is income ______. The income elasticity of demand for pet food and baby products is ______ than 1.
inelastic; less
As the price rises from $200 a chip to $300 a chip, total revenue ______. So at a price of $250 a chip, demand is ______.
rises; inelastic
